Define Costing
It is the amount of expenditure actual or notional “incurred on” or “attributable” “Actual” refers to expenses paid in Cash / Cheque. “Notional” refers to expenses not to be settled in cash. eg....
View ArticleWhat is the formula of Prime Cost?
PRIME COST : = DIRECT MATERIALS + DIRECT WAGES + DIRECT EXPENSES
View ArticleWhat is the formula of Works/Factory Cost?
FACTORY / WORKS COST : = PRIME COST + FACTORY OVERHEADS
View ArticleWhat is the formula of Production Cost?
COST OF PRODUCTION : = FACTORY COST + OFFICE & ADMINISTRATION OVERHEADS
View ArticleWhat is the formula of Cost of Goods sold?
COST OF GOODS SOLD : = COST OF PRODUCTION + OPENING STOCK OF FINISHED GOODS – CLOSING STOCK OF FINISHED GOODS
View ArticleWhat is the formula of Cost of Sales?
COST OF SALES : = COST OF GOODS SOLD + SELLING AND DISTRIBUTION OVERHEADS
View ArticleWhat are the Items to be completely ignored while preparing Cost Sheet?
Items to be “Completely Ignored” while Preparing Cost Sheet : I. *Gains / Incomes / Profits: All * to be completely ignored Except Sale of scrap etc. and Sale of finished goods. II. Expenses / Losses:...
View ArticleWhat is a Cost Sheet?
Cost sheet is a statement showing total cost (Cost of sales) and profit. It includes only two incomes i.e. sale of scrap etc. and sale of finished goods.
View ArticleWhat is Fixed Cost?
A fixed cost is that cost which remains unaffected by fluctuations in the levels of output. Fixed cost is that portion of the total cost which remains constant irrespective of output. Eg: (i) Rent of...
View ArticleWhat is Semi-variable Cost?
Semi-variable costs are also known as semi-fixed costs. Such costs contain partly fixed and partly variable elements. They exhibit a step-ladder pattern when presented graphically. Eg: (i) Telephone...
View ArticleWhat are Direct materials?
Direct Materials (Raw materials consumed) : This is the basic input raw material, without which the product cannot be manufactured. e.g. : 1) Cotton for Textiles, 2) Paper for Notebook, 3) Gold for...
View ArticleWhat is Functional and Behavioural Cost Classification?
The cost based on the nature of function or activity carried out by the respective cost is known as Functional classification of cost. There is one more method of classification, known as Behavioural...
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